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STOR-AGE PROPERTY REIT LIMITED - Provisional summarised consolidated annual results, declaration of a dividend and posting of a DRIP circular

Release Date: 12/06/2018 07:05
Code(s): SSS     PDF:  
 
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Provisional summarised consolidated annual results, declaration of a dividend and posting of a DRIP circular

STOR-AGE PROPERTY REIT LIMITED  
(Registration number: 2015/168454/06)
Incorporated in the Republic of South Africa
JSE share code: SSS   ISIN: ZAE000208963
Approved as a REIT by the JSE
("Stor-Age" or "the company" or "the group")

STOR-AGE PROPERTY REIT LIMITED
PROVISIONAL SUMMARISED CONSOLIDATED ANNUAL FINANCIAL RESULTS
for the year ended 31 March 2018

A DECLARATION OF A CASH DIVIDEND AND POSTING OF A CIRCULAR CONTAINING A DIVIDEND INVESTMENT ALTERNATIVE ELECTION IS INCLUDED IN THIS ANNOUNCEMENT

COMMENTARY
The board of directors ("the board") of Stor-Age is pleased to present the provisional summarised consolidated results of the company and its subsidiary companies
("the group") for the year ended 31 March 2018.

HIGHLIGHTS
- Total dividend up 11.1% to 97.83 cps
- Like-for-like growth in rental income and net property operating income of 10.6% and 11.8%
- Investment property valued at R3.85 billion (1), up 87%
- Strong and flexible balance sheet
- Conservative gearing of 16%
- Strategic entry into UK self storage market via Storage King acquisition
- Successful local Unit Self Storage and StorTown acquisitions added 27 800m2 GLA
- New development properties underway
- Oversubscribed equity raise of R1.3 billion in October 2017

INTRODUCTION
The board of Stor-Age is pleased to present continued strong trading results for the financial year to March 2018 ("the year"), in which the group continued
to deliver real gains in rental rates and occupancy to drive sustainable revenue and earnings growth. Stor-Age achieved this performance in a challenging
operating environment against a backdrop of uncertain political and economic events, and with many sector peers under performance pressure.

The final dividend of 50.81 cents per share is up 12.9% on the prior year and, when added to the interim dividend of 47.02 cents per share, brings the total
dividend to 97.83 cents per share or an 11.1% increase year-on-year. Stor-Age's strong trading performance is testament to the resilient nature of the
underlying product as well as our specialist sector focus and skills, a critical success factor. Our property portfolio, revenue management, technology and
operating platform are geared solely to a single growth sector.

The group's major acquisitions in 2017 - locally of Storage RSA, Unit Self Storage and StorTown and internationally in the UK via Storage King - added significant
scale and value to the portfolio and reflect our skill to identify and execute on value-add opportunities.

Since Stor-Age's listing in November 2015, total GLA has increased by 77% to over 321 000m2 and the value of properties has increased threefold to 
R3.9 billion. The oversubscription of our equity capital raise in October 2017 affirms investor confidence in our operating strategy and our successful
acquisition track record to date.

(1)  Investment property reflected as gross investment property of R4.034 billion less finance lease obligations relating to leasehold investment
     property of R181 million

SA   - South Africa
UK   - United Kingdom
CPC  - Certificate of Practical Completion
GLA  - gross lettable area

GROUP SNAPSHOT
Stor-Age is the largest and most recognisable self storage property fund and brand in South Africa. The portfolio comprises 63 self storage properties
across both SA and the UK.

The SA portfolio is predominantly purpose-built with a national footprint and comprises 49 self storage properties totalling 348 200m2. Stor-Age owns and
operates 35 of these properties comprising 264 400m2 GLA and representing R2.5 billion in value. The balance is made up of the unlisted Managed Portfolio
(83 800m2 GLA), from which Stor-Age earns property and asset management fees and over which it holds a pre-emptive right of acquisition.

In the UK Stor-Age owns a 97.4% majority interest in Storage King, which has 14 self storage properties totalling 57 000m2 GLA and representing R1.4 billion
in value. In addition, a further 12 properties trade under the licence of the Storage King brand and generate licence and management fee revenue. In total
this represents 26 properties trading under the brand.

OPERATIONAL REVIEW
- Strong trading results:
  - total portfolio occupancy up 84 200m2 (SA 27 200m2; UK 57 000m2)
  - closing occupancy of 85.2% (SA); 78.2% (UK)
  - closing rental of R91.6/m2 (SA), up 9.2% (excluding acquisitions in the year)
- Storage RSA acquisition fully integrated and performing as expected
- Continuing investment in digital presence, automation and technology

Stor-Age's ability to close transactions and integrate trading stores seamlessly onto the operating platform has been clearly demonstrated over the past 
18 months. Since the start of 2017 the group has successfully completed four significant transactions, including the offshore acquisition of Storage King in
November 2017. We have also initiated the development of two new self storage properties in Bryanston and Craighall under our CPC structure, and continued
with the ongoing expansion at certain of our existing stores.

In the SA portfolio, properties that have traded for more than five years exhibit an average length of stay for existing customers of 25 months and for all
properties, 24 months. The customer base remains consistently loyal and "sticky", boding well for continued sustainability. The detailed performance of the
SA portfolio is set out below in Financial Results.

The UK self storage market represents a significant growth opportunity and is characterised by a relative undersupply in comparison to the more established
Australian and US markets. Stor-Age's acquisition of Storage King represents an excellent entry point into this market as well as a scalable platform for
the group to further grow its offshore portfolio. The specialist management team remains on-board and co-invested as a minority shareholder.

Year-on-year net self storage rental income increased by 9% (3), including organic like-for-like growth of 6.2% (3), supported by a closing occupancy of 78.2% and 
rental rate of £21.13 (2) per square foot at year end, marginally lower than at the acquisition date. The UK self storage industry experiences a higher degree of 
seasonality compared to the South African market, which sees a traditionally slower trading period in the winter months. Excluding the acquisition of the Crewe 
property (see Acquisitions and Developments), occupancy grew organically by 900m2 over the year to March 2018. Operating performance in the first quarter of 
FY2019 has been in line with expectations.

Post the acquisition, Stor-Age has focused on certain strategic initiatives to position the Storage King business optimally for growth. These include:
- enhancing key operational areas;
- providing proven expertise in property development and acquisitions, treasury management and capital allocation;
- investigating integration of appropriate back office support functions; and
- formulating a detailed medium-term property growth strategy.

(2)  UK rental rate quoted on an annual basis
(3)  These figures have not been reviewed by our auditors

FINANCIAL RESULTS
The results for the year include the trading results for the full 12 months of Storage RSA and Unit Self Storage, while StorTown and Storage King have been
included for part periods from their respective acquisition dates. Revenue and earnings show significant increases from the previous year reflecting both
organic growth and the impact of acquisitions, a most pleasing result in the prevailing macro environment.

The table below sets out the group's underlying operating performance of the like-for-like portfolio as well as of acquisitions for a more meaningful
overview.

                                                      31 March 2018                           31 March 2017              % change
                                    SA Like-             SA   Storage            SA Like-            SA            
                                    for-like   acquisitions      King     Total  for-like  acquisitions     Total  SA Like-
                                       R'000          R'000     R'000     R'000     R'000         R'000     R'000  for-like    Total

Property revenue                     177 824         63 575    68 778   310 177   162 920         3 743   166 663      9.1%    86.1%
  Rental income                      171 525         62 132    61 702   295 359   155 128         3 673   158 801     10.6%    86.0%
  Ancillary income                     5 299          1 443     7 076    13 818     4 792            70     4 862     10.6%   184.2%
  Licence fees                         1 000              -         -     1 000     3 000             -     3 000    (66.7%)  (66.7%)
Direct operating costs               (39 895)       (13 308)  (23 714)  (76 917)  (37 404)         (944)  (38 348)     6.7%   100.6%
Net property operating income        137 929         50 267    45 064   233 260   125 516         2 799   128 315      9.9%    81.8%

Like-for-like reflects the same store portfolio trading for a full 12-month period in both the 2017 and 2018 financial years
SA acquisitions include Storage RSA, Unit Self Storage and StorTown

Total property revenue increased by 86.1% to R310.2 million (2017: R166.7 million).

Rental income for the year was R295.4 million (2017: R158.8 million), an 86.0% increase on the prior year. On a like-for-like basis (i.e. excluding
acquisitions) rental income increased by 10.6% from R155.1 million to R171.5 million, driven by an 1.8% increase in average occupancy levels and an 8.8%
increase in the average rental rate.

Total occupancy in the SA portfolio grew by 27 200m2 over the year (organically 4 700m2; Unit Self Storage and StorTown acquisitions 22 500m2). The
closing rental rate was R91.6/m2. Excluding acquisitions in the year, the closing rental rate increased by 9.2%, reflecting our balanced approach to revenue
management and occupancy growth.

The overall trading performance of Storage RSA (acquired on 28 February 2017) was in line with expectations. The integration of the business onto the 
Stor-Age operating platform has been largely completed.

Other income comprises licence fee income relating to the opening of new stores in the unlisted Managed Portfolio and ancillary income such as the sale of
merchandise (e.g. packaging materials and padlocks), administration fees, late fees and other sundry income. Licence fee income of R1.0 million relates to
the opening of the Randburg property in the unlisted Managed Portfolio in July 2017. (In the prior year, three new stores opened in this portfolio resulting
in licence fee income of R3.0 million.) Ancillary income of R13.8 million (2017: R4.9 million) reflects the positive contribution of acquisitions. On a
like-for-like basis, ancillary income increased by 10.6%.

Direct operating costs comprise mainly store-based staff salaries, rates, utilities, a full allocation of marketing spend and other property-related costs
such as insurance, maintenance, IT and communications at a property level. These costs are generally 'embedded' or of a fixed nature and, in the like-for-
like portfolio, the weightings of the various components of the cost base were broadly consistent with the prior year. The increase in direct operating
costs to R76.9 million (2017: R38.3 million) reflects the impact of acquisitions. The 6.7% increase in like-for-like operating costs is broadly in line
with inflationary growth.

Net property operating income of R233.3 million (2017: R128.3 million) reflects both organic growth and the benefit of acquisitions. On a like-for-like
basis, excluding acquisitions and licence fee income (considered non-recurring in nature), net property operating income increased by 11.8%. Stor-Age's
increased scale and revenue growth, as well as a disciplined approach to cost management, translates into real earnings growth. Storage King contributed
R45.1 million to net property operating income. On an overall basis, earnings were materially in line with the forecasts set out in the September 2017
circular relating to the acquisition.

Management fees comprise property and asset management fees charged on the unlisted Managed Portfolio and development fees on properties being developed
under the CPC structure. The management fees from the unlisted Managed Portfolio increased given the three new stores that commenced trading end-2016, the
opening of Randburg in July 2017 and higher occupancy levels which drove higher revenue. In addition the CPC structure resulted in development fees of 
R3.9 million.

Administrative expenses relate mainly to support function costs for IT, finance, HR, property management, professional fees and directors' remuneration. The
increase in administrative expenses from R25.0 million to R36.9 million relates mainly to the Storage King acquisition and the full year support function
costs for Storage RSA. Excluding the Storage King acquisition, administrative expenses increased by 18.7%, which is partly attributable to the underlying
growth in the business, a greater investment in technology, centralisation and automation, and the employment of additional staff.

Interest income comprises interest received on the share purchase scheme loans (R10.6 million), cross currency interest rate swaps (R10.6 million) and call
and money market accounts (R2.4 million). The increase in interest income from  R13.0 million to R23.6 million relates mainly to the cross currency interest
rate swaps entered into in November 2017 in respect of the Storage King transaction.

Interest expense comprises mainly interest on bank borrowings and the increase is due to higher average debt levels during the year and the GBP-denominated
debt arising from the Storage King acquisition. Further details of bank borrowings are set out in Capital Structure below.

Profit for the year of R587.2 million includes a fair value adjustment to derivative financial instruments of R178.5 million (2017: R1.8 million expense),
comprising a realised gain of R56.3 million on a forward exchange contract relating to the Storage King acquisition and unrealised mark-to-market gains of 
R122.2 million relating to forward exchange contracts, interest rate swaps and cross currency interest rate swaps.

CAPITAL STRUCTURE
Our financing policy is to fund our current needs through a mix of debt, equity and cash flow to enable the group to expand the portfolio and achieve our
strategic growth objectives.

Details of the group's borrowing facilities are set out below:

                                 SA         UK      Total
                          R million  R million  R million

Total debt facilities         995.0      406.0      1 401
Undrawn debt facilities       642.4          -      642.4
Gross debt                    352.6      406.0      758.6
Net debt                      227.5      392.2      619.7
Investment property (4)       2 490    1 363(1)     3 853
Subject to fixed rates
  - Amount                    250.0      369.1      619.1
  - % hedged on gross debt    70.9%      90.0%      81.6%
  - % hedged on net debt     109.9%      94.1%      99.9%
Effective interest rate       9.10%      4.32%      6.54%
Gearing (LTV ratio)            9.1%      28.8%      16.1%

LTV ratio defined as the ratio of net debt as a percentage of investment property (net of finance lease obligations relating to leasehold investment
property) 

The group currently has SA loan facilities of R995.0 million available. The respective maturities of the various facilities range from December 2019 to
November 2022 and accrue interest at an average margin of 1.29% below prime.

The acquisition of Storage King was structured with a GBP25.0 million LIBOR-linked facility. The facility has a five-year term and amortises by GBP2.0 million
in the first two years and by GBP5.3 million over the subsequent three years, to a balance of GBP17.9 million by December 2022. The balance at 31 March 2018 
was GBP24.5 million (R406.0 million).

The interest rate risk on the loan is hedged at 90% of the gross debt, in line with the amortisation profile, with underlying LIBOR fixed at 1.051%.

At 31 March 2018, Stor-Age's total gross borrowings amounted to R758.6 million (2017: R256.2 million) with 82% (2017: 78%) subject to fixed rates, and total
undrawn borrowing facilities of R642.4 million (2017: R393.8 million). On a net debt basis 100% of borrowings were subject to fixed rates (2017: 82%).

The effective interest rate at 31 March 2018 was 6.54% (2017: 9.36%).

In October 2017 the group raised R1.276 billion of equity capital in an oversubscribed book-build to fund the Storage King and StorTown transactions. 
Stor-Age also conserved R116 million cash under the Dividend Reinvestment Programme.

The conservative capital structure reflected net debt of R619.7 million at 31 March 2018 (2017: R244.6 million) and a gearing ratio (LTV) of 16.1% 
(2017: 11.9%).

Net asset value (net of minority interest) per share was R11.57 (2017: R10.70) and net tangible asset value per share (net of minority interest) was R11.01
(2017: R10.23).

(4)  Investment property reflected as gross investment property of R4 034 million less finance lease obligations relating to leasehold investment property 
     of R181 million

OCCUPANCY
The occupancy profile of the portfolio by GLA at 31 March 2018 is disclosed in the following table:

                          31 March 2018
Region                 GLA m2  % Occupied

Gauteng               126 554        86.3
Western Cape           86 673        83.8
Eastern Cape           11 032        86.2
KwaZulu-Natal          27 882        88.0
Free State              6 679        79.1
South Africa          258 820        85.3

United Kingdom         57 037        78.2

Total                 315 857        84.0

ACQUISITIONS AND DEVELOPMENTS
All growth initiatives below have been previously announced on SENS in detail.

Unit Self Storage
The acquisition of Unit Self Storage in Ottery, Cape Town was completed on 9 May 2017 for a purchase consideration of R42.0 million. The property has 
5 400m2 GLA and has been rebranded and fully integrated into the group.

Storage King
On 2 November 2017 the group acquired 97.3% of Storage King, the sixth largest self storage brand in the UK, for a purchase consideration of GBP53.7 million
(R1.0 billion (5)) funded with proceeds from the equity capital raise in October 2017. On 4 December 2017 Storage King completed the acquisition of a self
storage property in Crewe for a purchase consideration of GBP7.7 million (R142.9 million).

StorTown
On 2 November 2017 the group acquired 99.9% of DanCor Properties, a portfolio of four properties located in Durban, for a consideration of R145 million. The
properties comprise 22 400m2 GLA and are in the process of being rebranded. The acquisition was funded with proceeds from the equity capital raise in
October 2017.

Bryanston and Craighall developments
During the year the group entered into agreements with Stor-Age Property Holdings Proprietary Limited for the development of self storage properties in
Bryanston and Craighall, summarised below:

                                       Consideration
Date                 Development           R million

4 July 2017            Bryanston                99.3
7 December 2017        Craighall                95.1

These agreements are managed in terms of a development and acquisition structure known as a CPC and they result in the risk and reward of ownership
effectively passing to Stor-Age on 'practical' completion of the development.

(5)  Inclusive of transaction costs

The CPC structure is rooted in the United States' self storage REIT 'Certificate of Occupancy' deals, for which there is recent favourable precedent. The
CPC structure reduces the development and lease up risk for Stor-Age and provides an opportunity to develop high-profile properties in prime locations
without diluting the group's distribution growth profile over the medium term. The CPC structure is subject to strict independent and regulatory controls.

All-Store Self Storage
On 6 March 2018 Stor-Age entered into an agreement to acquire the All-Store Self Storage ("All-Store") property located in Cape Town's northern suburbs for
a purchase consideration of R52.0 million. The property, which has a well-established tenant base and decade long trading history, complements the existing
portfolio with 5 500m2 GLA. There is also significant undeveloped bulk available.

The purchase consideration was settled in full by the issue of ordinary shares pursuant to a vendor consideration placement on 6 April 2018, being the date
of the property transfer (see Events After the Reporting Date).

INVESTMENT PROPERTIES
A reconciliation of the movement in investment properties (net of finance lease obligations) is set out below:

                                                                                                                          2018       2017
                                                                                                                     R million  R million

Balance at beginning of year                                                                                             2 050      1 371
Acquisitions
  Storage RSA                                                                                                                -        477
  Unit Self Storage                                                                                                         42          -
  Storage King (including Crewe)                                                                                         1 711          -
  StorTown                                                                                                                 145          -
Other (including expansion at existing stores, unit mix and GLA reconfigurations and other capitalised expenditure)         45         56
Disposal of investment property                                                                                            (18)         -
CPC developments                                                                                                            40         19
Fair value adjustment                                                                                                      203        127
Movement in foreign exchange difference                                                                                   (184)         -
Balance at end of year                                                                                                   4 034      2 050
Finance lease obligations relating to leasehold investment property                                                       (181)        (1)
Net investment property at end of year                                                                                   3 853      2 049


The group's policy is to have one-third of the properties externally valued by an independent valuer each year and the remaining properties valued
internally by the board, using the same methodology applied by the external valuers. In line with this policy, 12 of the 34 properties in the SA portfolio
were valued independently by Mills Fitchet Magnus Penny (members of the South African Institute of Valuers) at 31 March 2018. For the UK portfolio, 6 of 
the 14 properties were valued independently by Cushman and Wakefield (Registered Valuers of The Royal Institution of Chartered Surveyors in the UK) at 
31 March 2018.

EVENTS AFTER THE REPORTING DATE
Stor-Age issued 4.16 million shares for an aggregate consideration of R52.0 million through a vendor consideration placement on 6 April 2018 to fund the
acquisition of All-Store.

The board is not aware of any other events that have a material impact on the results or disclosures of the group and which have occurred subsequent to the
end of the reporting period.

PROSPECTS
The quality of the Stor-Age property portfolio, supported by a robust and sophisticated operational platform, should continue to deliver sustainable
distribution growth even against the backdrop of a still challenging local economy. Our strategic entry into the UK self storage market, off an established
and scalable platform, will enable Stor-Age to selectively grow its offshore portfolio in regions where self storage sector fundamentals remain attractive.

We continue to pursue a clearly defined vision with a disciplined execution of strategy. Our balance sheet flexibility, low levels of gearing and increased
scale position Stor-Age strongly to continue taking advantage of new acquisition and development opportunities in both SA and the UK.

The board anticipates dividend growth of approximately 9 - 10% for the year ending 31 March 2019, subject to a stable macroeconomic environment. This
guidance has not been reviewed or reported on by the group's auditors.

BASIS OF PREPARATION
The provisional summarised consolidated annual financial results are prepared in accordance with the requirements of the JSE Limited Listings Requirements
for provisional reports, and the requirements of the Companies Act, 71 of 2008, as amended, ("Companies Act") applicable to summary financial statements.
The Listings Requirements require provisional reports to be prepared in accordance with the framework concepts and the measurement and recognition
requirements of International Financial Reporting Standards and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and
Financial Pronouncements as issued by the Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34
Interim Financial Reporting. The accounting policies applied in the preparation of the consolidated financial statements from which the summarised
consolidated financial statements were derived are in terms of International Financial Reporting Standards and are consistent with those accounting policies
applied in the preparation of the previous consolidated financial statements.

Any information included in this announcement that might be perceived as a forward looking statement has not been reviewed or reported on by the company's
auditors in accordance with section 8.40(a) of the Listings Requirements.

The provisional summarised consolidated annual financial results for the year ended 31 March 2018 and this summarised report were prepared under the
supervision of the Financial Director, Stephen Lucas CA(SA).

AUDIT OPINION
These provisional summarised consolidated annual financial results are extracted from the audited information, but is not itself audited. The consolidated
annual financial statements for the year ended 31 March 2018 were audited by KPMG Inc., who expressed an unmodified opinion thereon. The audited
consolidated annual financial statements for the year ended 31 March 2018 and the auditor's report thereon is available for inspection at the company's
registered office.

The directors take full responsibility for the preparation of these provisional summarised consolidated annual financial statements and that the financial
information has been correctly extracted from the consolidated annual financial statements.

The auditor's report does not necessarily report on all of the information contained in these provisional summarised consolidated annual financial results.
Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement they should obtain a copy of the
auditor's report together with the accompanying financial information from the company's registered office.

DIVIDEND DECLARATION DETAILS 
DECLARATION OF A CASH DIVIDEND WITH THE OPTION TO RE-INVEST THE CASH DIVIDEND IN RETURN FOR STOR-AGE SHARES
Notice is hereby given of the declaration of the gross final dividend (number 5) of 50.81 cents per share for the six months ended 31 March 2018 
("Cash Dividend").

Shareholders will be entitled, in respect of all or part of their shareholdings, to elect to re-invest the Cash Dividend in return for Stor-Age Shares
("Share") ("Share Alternative"). Those shareholders who do not elect the Share Alternative will receive the Cash Dividend. A circular providing further
information in respect of the Cash Dividend and Share Alternative ("the Circular") will be posted to shareholders on 12 June 2018.

Certificated Shareholders who wish to elect to receive the Share Alternative must complete the Form of Election contained in the Circular.

Dematerialised Shareholders who wish to receive the Share Alternative must instruct their CSDP or Broker with regard to their election in terms of the
custody agreement entered into between them and their CSDP or Broker.

The distribution of this Circular and the right to elect Shares in jurisdictions other than the Republic of South Africa may be restricted by law and
failure to comply with any of these restrictions may constitute a violation of the securities laws of any such jurisdiction. The rights of Shareholders to
elect Shares is not being offered, directly or indirectly, in the United States of America, the United Kingdom, Canada, Australia or Japan unless certain
exemptions from the requirements of those jurisdictions are applicable.

Salient dates and times                                                                                                                           2018
Record date for Shareholders to be registered in the Company's Securities Register in order to be entitled to receive the Circular      Friday, 1 June
Circular and Form of Election posted to Shareholders and announced on SENS                                                            Tuesday, 12 June
Finalisation announcement of Share Alternative issue price announced on SENS ("Finalisation Announcement")                            Tuesday, 26 June
Last day to trade ("LDT") cum-dividend and Share Alternative                                                                           Tuesday, 3 July
Shares to trade ex-dividend                                                                                                          Wednesday, 4 July
Listing of maximum possible Share Alternative Shares commences on the JSE at 09:00 on                                                   Friday, 6 July
Last day to elect to receive the Share Alternative (no late Forms of Election will be accepted) at 12:00                                Friday, 6 July
Record date to determine which Shareholders may participate in the Cash Dividend/Share Alternative ("Record Date")                      Friday, 6 July
Announcement of results of Cash Dividend and the Share Alternative on SENS                                                              Monday, 9 July
Cheques posted to Certificated Shareholders and accounts credited by CSDPs or Brokers of Dematerialised Shareholders who will 
receive the Cash Dividend                                                                                                               Monday, 9 July
Share certificates posted to Certificated Shareholders and accounts credited by CSDPs or Brokers of Dematerialised Shareholders
who have elected the Share Alternative on                                                                                           Wednesday, 11 July
Adjustment to number of Shares listed on or about                                                                                      Friday, 13 July

Notes:
- All times are South African times. The above dates and times are subject to change and any change will be advised via SENS and press announcements.
- Shareholders electing the Share Alternative are reminded that the new Shares will be listed on LDT+3 and that these new Shares can only be traded on 
  LDT+3 as a result of the settlement of Shares three days after the Record Date, which differs from the conventional one day after the Record Date
  settlement process.
- Shares may not be dematerialised or rematerialised between the commencement of trade on Wednesday, 4 July 2018 and the close of trade on Friday, 
  6 July 2018.

FRACTIONS
Fractions of Shares are not capable of being traded on the JSE. Accordingly, where a Shareholder's entitlement to Shares in relation to the Share
Alternative gives rise to a fraction of a new Share, such fraction will be rounded down to the nearest whole number in accordance with the JSE Limited
Listings Requirements and a cash payment will be made for the fraction.

TAX IMPLICATIONS
As the Company has REIT status, shareholders are advised that the dividend meets the requirements of a "qualifying distribution" for the purposes of section
25BB of the Income Tax Act (No. 58 of 1962), as amended, ("Income Tax Act"). The dividend on the Shares will be deemed to be a dividend, for South African
tax purposes, in terms of section 25BB of the Income Tax Act.

South African tax residents
The dividend received by or accrued to South African tax residents must be included in the gross income of such shareholders and will not be exempt from
income tax (in terms of the exclusion to the general dividend exception, contained in paragraph (aa) of section 10(1)(k)(i) of the Income Tax Act) because
it is a dividend distributed by a REIT. The dividend is exempt from dividend withholding tax in the hands of South African tax resident shareholders,
provided that the South African resident shareholders provide the following forms to the CSDP or broker in respect of uncertificated shares, or to the
Company, in respect of certificated shares:

a) a declaration that the dividend is exempt from dividend tax; and
b) a written undertaking to inform the CSDP, broker or the Company,

should the circumstances affecting the exemption change or the beneficial owner cease to be the beneficial owner, both in the form prescribed by the
Commissioner for the South African Revenue Service. Shareholders are advised to contact their CSDP, broker or the Company to arrange for the above-mentioned
documents to be submitted prior to payment of the dividend, if such documents have not already been submitted.

Non-resident Shareholders
Dividends received by non-resident shareholders will not be taxable as income and instead will be treated as an ordinary dividend which is exempt from
income tax in terms of the general dividend exemption in section 10(1)(k)(i) of the Income Tax Act. It should be noted that up to 31 December 2013 dividends
received by non-residents from a REIT were not subject to dividend withholding tax.

Since 1 January 2014, any dividend received by a non-resident from a REIT will be subject to dividend withholding tax at 20%, unless the rate is reduced in
terms of any applicable agreement for the avoidance of double taxation ("DTA") between South Africa and the country of residence of the shareholder
concerned. Assuming dividend withholding tax will be withheld at a rate of 20%, the net dividend amount due to non-resident shareholders is 40.648 cents per
share. A reduced dividend withholding rate in terms of the applicable DTA may only be relied on if the non-resident shareholder has provided the following
form to their CSDP or broker in respect of uncertificated shares, or the Company, in respect of certificated shares:

a) a declaration that the dividend is subject to a reduced rate as a result of the application of DTA; and
b) a written undertaking to inform their CSDP, broker or the Company

should the circumstances affecting the reduced rate change or the beneficial owner cease to be the beneficial owner, both in the form prescribed by the
Commissioner for the South African Revenue Service. Non-resident shareholders are advised to contact their CSDP, broker or the Company to arrange for the
above-mentioned documents to be submitted prior to payment of the dividend, if such documents have not already been submitted.

The Company's tax reference number is 90274205245.

Non-participating shares
An amalgamation and merger agreement was entered into between the Company, Castle Rock Investments and the  HJS Trust prior to listing, in terms of which
the Company acquired all the assets owned by Stor-Age Self Storage Proprietary Limited in terms of s44 of the Income Tax Act ("the Agreement") in
consideration for the allotment of 10 000 000 ordinary shares in the Company ("Consideration Shares"), comprising 3.26% of the issued share capital, and 
the distribution of those shares to Castle Rock Investments and HJS Trust as a dividend.

In terms of the Agreement, a mechanism was agreed in terms of which the Consideration Shares will not participate fully in the distribution of distributable
profits earned by the Company in the ordinary course of business ("Distributable Profits"), and declared by the Company as an interim or final dividend,
for the period from the listing date of the Company (16 November 2015) until 31 March 2020, on a tiered basis as follows:

                                                 % of the Consideration Shares
                                                entitled to participate in the
                                     distribution of the Distributable Profits

16 November 2015 to 31 March 2016                                           0%
1 April 2016 to 31 March 2017                                               0%
1 April 2017 to 31 March 2018                                              25%
1 April 2018 to 31 March 2019                                              50%
1 April 2019 to 31 March 2020                                              75%
1 April 2020 onwards                                                      100%

The Consideration Shares will however participate fully in any distribution of profits earned from the disposal of any properties.

The amount which would have been declared as a dividend in respect of the Consideration Shares shall be declared and paid as a dividend, pro rata, to the
holders of the remaining shares in Stor-Age. As security for this arrangement, the Consideration Shares, or the relevant portion thereof, as the case may
be, are held in certificated form in escrow for the period during which the distribution restrictions apply and in the event that these shares are disposed
of, the shares will be transferred to another escrow arrangement and the acquirer thereof will be subject to the same restrictions regarding the
distributions detailed above.

A reconciliation of the number of shares in issue and the number of shares entitled to receive the dividend, together with the resultant dividend per share,
is included below:

Distributable profits (note 1) (R'000)                                151 913
Number of shares entitled to the dividend ('000)                      298 524
Number of shares in issue as at the date of this announcement ('000)  306 024
Consideration Shares not entitled to the dividend ('000) (note 2)       7 500
Dividend per share (cents)                                              50.81

Notes:

1. Stor-Age did not undertake any disposals of any properties during the year ended 31 March 2018 and all of the distributable profits of Stor-Age
   were earned in the ordinary course of business.
2. Comprises 7 500 000 Stor-Age shares, being 75% of the Consideration Shares that are excluded from participating in the Distributable Profits.
3. At the date of this announcement, Stor-Age had 306 024 102 ordinary shares in issue.

On behalf of the board.

PA Theodosiou        GM Lucas
Chairman             CEO
Cape Town
12 June 2018

SUMMARISED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
at 31 March 2018

                                             Audited    Audited
                                            31 March   31 March
                                                2018       2017
                                               R'000      R'000

Assets
Non-current assets                         4 493 563  2 263 524
Investment properties                      4 034 430  2 050 210
Property and equipment                         4 969      2 070
Stor-Age share purchase scheme loans         166 961    125 480
Goodwill and intangible assets               144 036     83 670
Deferred taxation                             19 098      2 094
Derivative financial instruments             124 069          -

Current assets                                90 156     20 593
Trade and other receivables                   65 165     10 674
Inventories                                    3 168      1 888
Cash and cash equivalents                     21 823      8 031

Total assets                               4 583 719  2 284 117

Equity and liabilities
Shareholders' interest                     3 494 259  1 889 831
Stated capital                             3 175 075  1 766 561
Non-distributable reserve                    523 006    141 058
Accumulated loss                            (108 855)   (17 788)
Foreign currency translation reserve        (120 732)         -
Total attributable equity to shareholders  3 468 494  1 889 831
Non-controlling interest                      25 765          -

Non-current liabilities                      801 598    113 000
Bank borrowings                              624 985    106 202
Derivative financial instruments               3 343      1 409
Finance lease obligations                    173 270      5 389

Current liabilities                          287 862    281 286
Bank borrowings                               16 571    146 470
Trade and other payables                      94 817     38 573
Provisions                                    16 331     20 047
Finance lease obligations                      8 230        906
Dividends payable                            151 913     75 290

Total equity and liabilities               4 583 719  2 284 117

SUMMARISED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
for the year ended 31 March 2018

                                                             Audited   Audited
                                                            31 March  31 March
                                                                2018      2017
                                                               R'000     R'000

Property revenue                                             310 177   166 663
- Rental income                                              295 359   158 801
- Other income                                                14 818     7 862
Direct property costs                                        (76 917)  (38 348)
Net property operating income                                233 260   128 315
Other revenue                                                 22 053    13 748
- Management fees                                             22 053    13 748
Administration expenses                                      (36 923)  (24 995)
Operating profit                                             218 390   117 068
Transaction and advisory fees                                 (6 552)        -
Gain on bargain purchase                                         377        41
Fair value adjustment to investment properties               203 001   127 240
Fair value adjustment to derivative financial instruments    178 570         -
- Realised                                                    56 321         -
- Unrealised                                                 122 249         -
Depreciation and amortisation                                 (2 232)   (1 552)
Profit before interest and taxation                          591 554   242 797
Interest income                                               23 601    13 026
Interest expense                                             (33 091)  (15 769)
Profit before taxation                                       582 064   240 054
Taxation expense                                              (3 839)      671
- Normal taxation                                                 (3)        -
- Deferred taxation                                           (3 836)      671

Profit for the year                                          578 225   240 725

Items that may be reclassified to profit or loss
Fair value adjustment to derivative financial instruments          -    (1 760)
Deferred taxation                                                  -       394
Translation of foreign operations                           (123 902)        -
Other comprehensive income for the year, net of taxation    (123 902)   (1 366)

Total comprehensive income for the year                      454 323   239 359

Profit attributable to:
Owners of the company                                        576 726   240 725
Non-controlling interest                                       1 499         -

Total comprehensive income attributable to:
Owners of the company                                        455 994   239 359
Non-controlling interest                                      (1 671)        -

RECONCILIATION OF BASIC EARNINGS AND HEADLINE EARNINGS 
for the year ended 31 March 2018

                                                                31 March   31 March
                                                                    2018       2017
                                                                   R'000      R'000

Profit for the period (attributable to owners of the parent)     576 726    240 725
Basic earnings                                                   576 726    240 725
Headline earnings adjustments*                                  (202 600)  (127 281)
  Fair value adjustment of investment properties                (203 001)  (127 240)
  Fair value adjustment of investment properties (NCI)+              778          -
  Gain on bargain purchase                                          (377)       (41)
Headline earnings attributable to shareholders                   374 126    113 444

Total shares in issue ('000)                                     301 864    176 876
Weighted average shares in issue ('000)                          237 950    142 662
Shares entitled to dividends in issue ('000)                     298 524    166 876
Weighted average shares entitled to dividends in issue ('000)    230 450    132 662

Basic and diluted earnings per shares (cents)                     250.26     181.46
Basic and diluted headline earnings per share (cents)             162.35      85.51

* Stor-Age has no dilutive instruments in place
+ Non-controlling interest

SUMMARISED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 March 2018

                                                                                                               Foreign        
                                                                                      Non-                    Currency         Total        Non-
                                                                     Stated  distributable  Accumulated    Translation  Attributable controlling  
                                                                    capital        reserve         loss        Reserve     to parent    Interest  Total Equity
                                                                      R'000          R'000        R'000          R'000         R'000       R'000         R'000

Balance at 1 April 2016                                           1 362 647         18 126         (525)             -     1 380 248           -     1 380 248

Total comprehensive income for the year                                   -              -      239 359              -       239 359           -       239 359
Profit for the year                                                       -              -      240 725              -       240 725           -       240 725
Other comprehensive income                                                -              -       (1 366)             -        (1 366)          -        (1 366)
Transaction costs capitalised on acquisition of subsidiary                -         (2 589)           -              -        (2 589)          -        (2 589)

Transactions with shareholders, recognised directly in equity
Issue of shares                                                     403 914              -            -              -       403 914           -       403 914
Proceeds                                                            404 751              -            -              -       404 751           -       404 751
Share issue costs                                                      (837)             -            -              -          (837)          -          (837)
Transfer to non-distributable reserve                                     -        125 521     (125 521)             -             -           -             -
Dividends                                                                 -              -     (131 101)             -      (131 101)          -      (131 101)
Total transactions with shareholders                                403 914              -     (256 622)             -       272 813           -       272 813

Balance at 31 March 2017                                          1 766 561        141 058      (17 788)             -     1 889 831           -     1 889 831

Total comprehensive income for the year                                   -              -      576 726       (120 732)      455 994      (1 671)      454 323
Profit for the year                                                       -              -      576 726              -       576 726       1 499       578 225
Other comprehensive income                                                -              -            -       (120 732)     (120 732)     (3 170)     (123 902)

Transactions with shareholders, recognised directly in equity
Issue of shares                                                   1 408 514              -            -              -     1 408 514           -     1 408 514
Proceeds                                                          1 440 643              -            -              -     1 440 643           -     1 440 643
Share issue costs                                                   (32 129)             -            -              -       (32 129)          -       (32 129)
Transfer to non-distributable reserve                                     -        381 948     (381 948)             -             -           -             -
Dividends                                                                 -              -     (285 845)             -      (285 845)          -      (285 845)
Total transactions with shareholders                              1 408 514        381 948     (667 793)             -     1 122 669           -     1 122 669

Changes in ownership interests
Acquisition of subsidiary with non-controlling interest                   -              -            -              -             -      27 434        27 434
Acquisition of subsidiary with non-controlling interest 
without change in control                                                 -              -            -              -             -           2             2

Balance at 31 March 2018                                          3 175 075        523 006     (108 855)      (120 732)    3 468 494      25 765     3 494 259

SUMMARISED CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 31 March 2018

                                                                   Audited    Audited
                                                                  31 March   31 March
                                                                      2018       2017
                                                                     R'000      R'000

Cash flows from operating activities
Cash generated from operations                                     201 766    118 589
Interest income                                                     19 365      3 320
Interest paid                                                      (33 475)   (15 769)
Dividends paid                                                    (209 222)   (94 717)
Net cash (outflow)/inflow from investing activities                (21 566)    11 423

Cash flows from investing activities
Acquisition of investment properties                              (204 369)   (75 283)
Proceeds on disposal of investment properties                        5 369          -
Repayment of Stor-Age share purchase scheme loans                    1 594      8 605
Acquisition of property and equipment                               (2 828)    (1 781)
Acquisition of intangible assets                                    (1 799)      (239)
Acquisition of subsidiaries, net of cash acquired               (1 079 212)  (465 342)
Net cash outflow from investing activities                      (1 281 245)  (534 040)

Cash flows from financing activities
(Repayment)/advance of bank borrowings                             (25 388)   123 651
Proceeds from the issue of shares                                1 392 557    400 000
Share issue costs                                                  (32 129)      (837)
Repayment of finance leases                                         (8 693)    (2 024)
Net cash inflow from financing activities                        1 326 347    520 790

Effect of exchange rate changes on cash and cash equivalents        (9 744)         -
Net cash inflow/(outflow) for the period                            13 792     (1 827)
Cash and cash equivalents at beginning of year                       8 031      9 858
Cash and cash equivalents at end of year                            21 823      8 031

SEGMENTAL INFORMATION
for the year ended 31 March 2018

Segmental information is based on the geographic location of each investment property. The group trades in five of the nine provinces in South Africa and in
the United Kingdom through its subsidiary Betterstore Self Storage Holdings. The group is managed on a consolidated basis and inter-segmental transactions
have been eliminated. The segmental information is limited to:

- On the statement of profit or loss and other comprehensive income: Rental income, other income, fair value adjustments to investment properties and direct
  property costs.
- On the statement of financial position: Investment properties, tenant debtors and inventories.

The chief executive officer reviews the segmental information on a quarterly basis.

Group: 12 months ended 31 March 2018

                                                                                                                    Total     Total
                                                             Western                    Free  KwaZulu-  Eastern     South    United     Total
                                                                Cape    Gauteng        State     Natal     Cape    Africa   Kingdom  Combined
                                                               R'000      R'000        R'000     R'000    R'000     R'000     R'000     R'000

Revenue                                                      113 477    105 082        3 594    12 264    6 982   241 399    68 778   310 177
- Rental income                                              110 548    100 720        3 436    12 154    6 799   233 657    61 702   295 359
- Other income                                                 2 929      4 362          158       110      183     7 742     7 076    14 818
Direct property costs                                        (21 974)   (23 463)      (1 622)   (4 000)  (2 144)  (53 203)  (23 714)  (76 917)
Operating profit                                              91 503     81 619        1 972     8 264    4 838   188 196    45 064   233 260
Fair value adjustment to investment properties               106 771     48 237        1 097    15 639      884   172 628    30 373   203 001
Total profit for the year                                    198 274    129 856        3 069    23 903    5 722   360 824    75 437   436 261

Reconciliation of segmental results to profit for the year in the statement of profit or loss and other comprehensive income

                                                               Total  Allocated  Unallocated
                                                               R'000      R'000        R'000

Property revenue                                             310 177    310 177            -
- Rental income                                              295 359    295 359            -
- Other income                                                14 818     14 818            -
Direct property costs                                        (76 917)   (76 917)           -
Net property operating income                                233 260    233 260            -
Other revenue                                                 22 053          -       22 053
- Management fees                                             22 053          -       22 053
Administration costs                                         (36 923)         -      (36 923)
Operating profit                                             218 390    233 260      (14 870)
Transaction and advisory fees                                 (6 552)         -       (6 552)
Gain on bargain purchase                                         377          -          377
Fair value adjustment to investment properties               203 001    203 001            -
Fair value adjustment to derivative financial instruments    178 570          -      178 570
Depreciation and amortisation                                 (2 232)         -       (2 232)
Profit before interest and taxation                          591 554    436 261      155 293
Interest income                                               23 601          -       23 601
Interest expense                                             (33 091)         -      (33 091)
Profit before taxation                                       582 064    436 261      145 803
Taxation expense                                              (3 839)         -       (3 839)
Profit for the year                                          578 225    436 261      141 964
Fair value adjustment to derivative financial instruments          -          -            -
Deferred taxation                                                  -          -            -
Translation of foreign operations                           (123 902)         -     (123 902)
Other comprehensive income for the year, net of taxation    (123 902)         -     (123 902)
Total comprehensive income for the year                      454 323    436 261       18 062

Segment assets
Group: as at 31 March 2018

                                                                                                          Total      Total
                                                  Western                    Free  KwaZulu-  Eastern      South     United      Total
                                                     Cape    Gauteng        State     Natal     Cape     Africa    Kingdom   Combined
                                                    R'000      R'000        R'000     R'000    R'000      R'000      R'000      R'000

Investment properties                           1 161 948  1 026 053       25 700   216 863   59 000  2 489 564  1 544 866  4 034 430
Tenant debtors                                      1 308      1 594           82       354      139      3 483      6 396      9 879
Inventories                                         1 109      1 209           74       169       85      2 646        522      3 168

Segment assets, reserves and liabilities
Group: as at 31 March 2018

                                                    Total  Allocated  Unallocated
                                                    R'000      R'000        R'000

Assets
Non-current assets                              4 493 563  4 034 430      459 133
Investment properties                           4 034 430  4 034 430            -
Property and equipment                              4 969          -        4 969
Stor-Age share purchase scheme loans              166 961          -      166 961
Goodwill and intangible assets                    144 036          -      144 036
Deferred taxation                                  19 098          -       19 098
Derivative financial instruments                  124 069          -      124 069
Current assets                                     90 156     13 047       77 250
Trade and other receivables                        65 165      9 879       55 427
Inventories                                         3 168      3 168            -
Cash and cash equivalents                          21 823          -       21 823
Total assets                                    4 583 719  4 047 477      536 383
Equity and liabilities
Shareholders' interest                          3 494 259          -    3 494 259
Stated capital                                  3 175 075          -    3 175 075
Non-distributable reserve                         523 006          -      523 006
Accumulated loss                                 (108 855)         -     (108 855)
Foreign currency translation reserve             (120 732)         -     (120 732)
Total attributable equity to owners             3 468 494          -    3 468 494
Non-controlling interest                           25 765          -       25 765
Non-current liabilities                           801 598          -      801 598
Bank borrowings                                   624 985          -      624 985
Derivative financial instruments                    3 343          -        3 343
Finance lease obligations                         173 270          -      173 270
Current liabilities                               287 862          -      287 862
Bank borrowings                                    16 571          -       16 571
Trade and other payables                           94 817          -       94 817
Provisions                                         16 331          -       16 331
Finance lease obligations                           8 230          -        8 230
Dividends payable                                 151 913          -      151 913
Total equity and liabilities                    4 583 719          -    4 583 719

SEGMENTAL INFORMATION
for the year ended 31 March 2017

                                                  Western                Free  KwaZulu-  Eastern
                                                     Cape    Gauteng    State     Natal     Cape      Total
                                                    R'000      R'000    R'000     R'000    R'000      R'000

Revenue                                            67 085     84 141    3 684     5 179    6 574    166 663
- Rental income                                    65 425     79 334    3 537     4 126    6 379    158 801
- Other income                                      1 660      4 807      147     1 053      195      7 862
Direct property costs                             (13 021)   (20 747)  (1 264)   (1 669)  (1 647)   (38 348)
Operating profit                                   54 064     63 394    2 420     3 510    4 927    128 315
Fair value adjustment to investment properties     75 670     38 628    1 332     9 530    2 080    127 240
Total profit for the year                         129 734    102 022    3 752    13 040    7 007    255 555

Reconciliation of segmental results to profit for the year in the statement of profit or loss and other comprehensive income

                                                               Total  Allocated  Unallocated
                                                               R'000      R'000        R'000

Property revenue                                             166 663    166 663            -
- Rental income                                              158 801    158 801            -
- Other income                                                 7 862      7 862            -
Direct property costs                                        (38 348)   (38 348)           -
Net property operating income                                128 315    128 315            -
Other revenue                                                 13 748          -       13 748
- Management fees                                             13 748          -       13 748
Administration costs                                         (24 995)         -      (24 995)
Operating profit                                             117 068    128 315      (11 247)
Gain on bargain purchase                                          41          -           41
Fair value adjustment to investment properties               127 240    127 240            -
Depreciation and amortisation                                 (1 552)         -       (1 552)
Profit before interest and taxation                          242 797    255 555      (12 758)
Interest income                                               13 026          -       13 026
Interest expense                                             (15 769)         -      (15 769)
Profit before taxation                                       240 054    255 555      (15 501)
Taxation expense                                                 671          -          671
Profit for the year                                          240 725    255 555      (14 830)
Fair value adjustment to derivative financial instruments     (1 760)         -       (1 760)
Deferred taxation                                                394          -          394
Other comprehensive income for the year, net of taxation      (1 366)         -       (1 366)
Total comprehensive income for the year                      239 359    255 555      (16 196)

Segment assets

                                                             Western                  Free  KwaZulu-  Eastern
                                                                Cape    Gauteng      State     Natal     Cape      Total
                                                               R'000      R'000      R'000     R'000    R'000      R'000

Investment properties                                        996 892    938 818     24 500    32 000   58 000  2 050 210
Trade and other receivables                                      891        941         37        50       62      1 981
Inventories                                                      973        777         43        43       52      1 888

Segment assets, reserves and liabilities

                                                               Total  Allocated  Unallocated
                                                               R'000      R'000        R'000

Assets
Non-current assets                                         2 263 524  2 050 210      213 314
Investment properties                                      2 050 210  2 050 210            -
Plant and equipment                                            2 070          -        2 070
Stor-Age share purchase scheme loans                         125 480          -      125 480
Goodwill and intangible assets                                83 670          -       83 670
Deferred taxation                                              2 094          -        2 094
Current assets                                                20 593      3 869       16 724
Trade and other receivables                                   10 674      1 981        8 693
Inventories                                                    1 888      1 888            -
Cash and cash equivalents                                      8 031          -        8 031
Total assets                                               2 284 117  2 054 079      230 038

Shareholders' interest                                     1 889 831          -    1 889 831
Stated capital                                             1 766 561          -    1 766 561
Non-distributable reserve                                    141 058          -      141 058
Accumulated loss                                             (17 788)         -      (17 788)
Non-current liabilities                                      113 000          -      113 000
Bank borrowings                                              106 202          -      106 202
Derivative financial instruments                               1 409          -        1 409
Finance lease obligations                                      5 389          -        5 389
Current liabilities                                          281 286          -      281 286
Bank borrowings                                              146 470          -      146 470
Trade and other payables                                      38 573          -       38 573
Provisions                                                    20 047          -       20 047
Finance lease obligations                                        906          -          906
Dividends payable                                             75 290          -       75 290
Total equity and liabilities                               2 284 117          -    2 284 117

RECONCILIATION OF DIVIDEND PER SHARE
for the year ended 31 March 2018

Reconciliation of headline earnings and distributable earnings per share

                                                                    Audited    Audited
                                                                  12 months  12 months
                                                                   31 March   31 March
                                                                       2018       2017
                                                                      R'000      R'000

Headline earnings attributable to shareholders                      374 126    113 444
Distributable earnings adjustment                                   (88 281)    17 657
Amortisation and depreciation of assets                               2 232      1 552
Fair value adjustment to derivative financial instruments          (178 570)         -
Fair value adjustment to derivative financial instruments (NCI)+         79          -
Deferred tax                                                          3 836          -
Transaction and advisory fee                                          6 552          -
Antecedent dividend on share issues*                                 77 590     16 105
Distributable earnings                                              285 845    131 101

Dividend declared for the 6 months ending 30 September              133 932     55 811
Dividend declared for the 6 months ending 31 March                  151 913     75 290
Total dividends for the year                                        285 845    131 101

Shares entitled to dividends September ('000)                       284 840    129 674
Shares entitled to dividends March ('000)                           298 964    167 275

Dividend per share September (cents)                                  47.02      43.04
Dividend per share March (cents)                                      50.81      45.01
Total distribution per share for the period (cents)                   97.83      88.05

The interim dividend of 47.02 cents (2017: 43.04 cents) per share for the period ending 30 September 2017 was declared on 17 November 2017 and the final
dividend of 50.81 cents (2017: 45.01 cents) per share for the period ending 31 March 2018 was declared on 13 March 2018.

+ Non-controlling interest
* In the determination of distributable earnings, the group elects to make an adjustment for the antecedent dividend arising as a result of the issue
  of shares during the period for which the company did not have full access to the cash flow from such issue

BUSINESS COMBINATIONS

The company (through its wholly-owned subsidiary Roeland Street Investments Proprietary Limited ("RSI")) acquired Unit Self Storage Proprietary Limited
("Unit"), Dancor Properties Proprietary Limited ("Dancor") and Betterstore Self Storage Holdings Limited ("Betterstore").

The acquisitions of Unit (one property located in Ottery, Cape Town with 5 400m2 GLA) and Dancor (four properties located in Durban with 22 400m2 GLA) are
in line with the company's strategy of pursuing value-added acquisitions in a fragmented industry and strengthening its position as South Africa's leading
self storage brand.

The acquisition of Betterstore represented a strategic entry into the UK self storage market. Betterstore owns and operates the Storage King business, a
portfolio of 14 self storage properties totalling 57 000m2 GLA at 31 March 2018. In addition, a further 12 properties trade under the licence of the
Storage King brand and generate licence and management fee revenue. In total this represents 26 properties trading under the brand. The UK self storage
market represents a significant growth opportunity and is characterised by a relative undersupply in comparison to the more established Australian and US
markets. The acquisition provides a scalable platform for the group to further grow its offshore portfolio. The specialist management team remains on-board
and co-invested as a minority shareholder.

The details of the transactions are set out below:

                                                                                                                               Group
                                                                                                                                2018
                                                                                                                               R'000

1.  Acquisition of Unit Self Storage
    On 9 May 2017 RSI subscribed for 2 230 shares in Unit. On the effective date, Unit repurchased 100 shares 
    from the existing shareholders, resulting in RSI owning 100% of the share capital in the company. The 
    total consideration paid for the subscription of shares and repurchase of shares was R42.1 million. The
    consideration was settled in cash to the vendors.

    The acquired business contributed revenue of R3.9 million and net profit before tax of R2.8 million to 
    Stor-Age from the effective date of 9 May 2017 to 31 March 2018. In the previous financial year, prior 
    to the acquisition by RSI, Unit earned revenue of R3.6 million and a net profit before tax of 
    R1.1 million.

    The fair value of the acquired trade receivables is R1.1 million and is expected to be collectible. 

    The assets and liabilities as at 9 May 2017 arising from the acquisition are as follows:
    Investment property*                                                                                                      42 081
    Plant and equipment                                                                                                           12
    Trade and other receivables                                                                                                1 053
    Cash and cash equivalents                                                                                                      7
    Trade and other payables                                                                                                    (701)
    Fair value of net identifiable assets acquired                                                                            42 452
    Gain on bargain purchase                                                                                                    (371)
    Total purchase consideration                                                                                              42 081

    Net cash outflow on acquisition                                                                                           42 074
    Consideration financed by cash                                                                                            42 081
    Cash and cash equivalents acquired                                                                                            (7)

    Acquisition-related costs of R298 000 that were incurred to effect the business combination have 
    been recognised in profit or loss and in operating cash flows in the statement of cash flows.

    * The valuation technique used to determine the fair value of the investment property acquired is consistent with the group's accounting policy.
                                                                                                                           
                                                                                                                               Group
                                                                                                                                2018
                                                                                                                               R'000

2.  Acquisition of Dancor
    On 2 November 2017 RSI subscribed for 99.9% of the issued share capital of Dancor. The existing 
    shareholders of Dancor will retain 0.1% of Dancor for the immediate future. The total consideration 
    for the acquisition was R145.0 million and was settled in cash to the vendors.

    The acquired business contributed revenue of R7.6 million and net profit before tax and fair  
    value adjustments of R5.5 million to the group from the effective date of 2 November 2017 to 
    31 March 2018. In the previous financial year, prior to the acquisition by RSI, the acquired 
    business earned revenue of R14.3 million and a net profit before tax and fair value adjustments
    of R11.3 million.

    The fair value of acquired trade receivables is R3.8 million. The gross contractual amount for 
    trade receivables due is R3.9 million, of which R66 000 is expected to be uncollectible.

    The assets and liabilities as at 2 November 2017 arising from the acquisition are as follows:
    Investment property*                                                                                                    145 000
    Property and equipment                                                                                                       61
    Trade and other receivables                                                                                               3 785
    Cash and cash equivalents                                                                                                   521
    Inventory                                                                                                                    29
    Provision                                                                                                                  (929)
    Trade and other payables                                                                                                 (3 461)
    Fair value of net identifiable assets acquired                                                                          145 006
    Non-controlling interest#                                                                                                     -
    Gain on bargain purchase                                                                                                     (6)
    Total purchase consideration                                                                                            145 000

    Net cash outflow on acquisition                                                                                         144 479
    Consideration financed by cash                                                                                          145 000
    Cash and cash equivalents acquired                                                                                         (521)

    Acquisition-related costs of R311 000 that were incurred to effect the business combination have been recognised in profit or loss
    and in operating cash flows in the statement of cash flows.

    *  The valuation technique used to determine the fair value of the investment property acquired is consistent with the group's accounting policy
    #  The equity owned by the non-controlling interests in Dancor do not share in the investee's profits

                                                                                                                              Group
                                                                                                                               2018
                                                                                                                              R'000
    Acquisition of Betterstore
    On 2 November 2017 RSI acquired 97.3% of the issued share capital of Betterstore. The total 
    consideration for the acquisition was R1.0 billion and was settled in cash to the vendors.
    The acquired business contributed revenue of GBP4.1 million (R70 million^) and net profit 
    before tax and fair value adjustments of GBP1.6 million (R27.5 million^) to the group from the 
    effective date of 2 November 2017 to 31 March 2018. In the previous financial year, prior to 
    the acquisition by RSI, the acquired business earned revenue of GBP9.1 million (R156.6 million^) 
    and a net profit before tax and fair value adjustments of GBP4.1 million (R70.6 million^).

    The fair value of acquired trade receivables is GBP1.9 million (R36.1 million#). The gross 
    contractual amount for trade receivables due is GBP1.9 million (R36.33 million#), of which 
    GBP10 000 (R187 567#) is expected to be uncollectible.

    Subsequent to the effective date of the transaction, Betterstore changed its year end from 
    31 December to 31 March in order to align its financial year with the group.

    The assets and liabilities as at 2 November 2017 arising from the acquisition are as follows:
    Investment property*                                                                                                  1 567 948
    Property and equipment                                                                                                    2 551
    Trade and other receivables                                                                                              36 144
    Intangible asset                                                                                                         17 237
    Cash and cash equivalents                                                                                                72 832
    Deferred tax asset                                                                                                       23 577
    Inventory                                                                                                                   788
    Financial liabilities                                                                                                  (468 918)
    Trade and other payables                                                                                                (57 383)
    Finance lease liability                                                                                                (202 385)
    Fair value of net identifiable assets acquired                                                                          992 391
    Non-controlling interest+                                                                                               (27 434)
    Goodwill                                                                                                                 41 565
    Total purchase consideration                                                                                          1 006 522

    Net cash outflow on acquisition                                                                                         933 690
    Consideration financed by cash                                                                                        1 006 522
    Cash and cash equivalents acquired                                                                                      (72 832)

    Acquisition-related costs of R5.9 million that were incurred to effect the business combination have been recognised in profit 
    or loss and in operating cash flows in the statement of cash flows.

    The goodwill arising at acquisition is attributable to the experienced management operating team and the potential to expand 
    the Storage King brand across the United Kingdom.

    Subsequent to the acquisition above, RSI subscribed for an additional 4 237 544 shares in Betterstore on 4 December 2017, 
    for a total consideration of R80.4 million, which increased RSI's shareholding to 97.4% of the issued shares. The cash 
    raised was used to acquired a self storage property situated in Crewe, United Kingdom.

    *  The valuation technique used to determine the fair value of the investment property acquired is consistent with the group's accounting policy
    +  The non-controlling interest is measured at its proportionate share of the investee's identifiable net assets at the acquisition date
    #  Amounts have be translated at GBP1:R18.7567
    ^  Amounts have been translated at GBP1:R17.2136

RELATED PARTY TRANSACTIONS

Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in
making financial or operational decisions. The shares of Stor-Age Property REIT are widely held.

Identity of the related parties with whom material transactions have occurred
Subsidiaries
- Roeland Street Investments Proprietary Limited
- Wimbledonway Investments Proprietary Limited
- N14 Self Storage Proprietary Limited
- Units 1-4 Somerset West Business Park Proprietary Limited
- Unit Self Storage Proprietary Limited
- Dancor Properties Proprietary Limited
Directors as listed below.
Key management personnel
Related through common shareholding/directorships or affiliation with related parties
- Madison Square Holdings Close Corporation
- Roeland Street Investments 2 Proprietary Limited
- Roeland Street Investments 3 Proprietary Limited
- Stor-Age Property Holdings Proprietary Limited
- Castle Rock Capital Trust

Material related party transactions and balances

                                                               2018      2017
Related party balances                                        R'000     R'000

Amounts - owing by related parties
- Stor-Age Property Holdings Proprietary Limited              6 336       221
- Castle Rock Capital Trust                                       2       982
- Roeland Street Investments 2 Proprietary Limited               15        97
- Madison Square Holdings Close Corporation                   2 972       814

Working capital - owing by related parties
- Roeland Street Investments 2 Proprietary Limited                -       444
- Roeland Street Investments 3 Proprietary Limited            1 024         -

Working capital - owing to related parties
- Roeland Street Investments 2 Proprietary Limited            2 492     1 406

Related party transactions

Interest received on Stor-Age share purchase scheme loans
- Directors and key management personnel                      8 739     9 706
License fees received from related party
- Roeland Street Investments 3 Proprietary Limited            1 000         -
Development fees paid (to)/from related parties
- Madison Square Holdings Close Corporation                 (30 163)  (39 225)
- Roeland Street Investments 2 Proprietary Limited              763     1 718
- Roeland Street Investments 3 Proprietary Limited              276       635
- Stor-Age Property Holdings Proprietary Limited              3 914         -
Asset management fees received from related party
- Roeland Street Investments 2 Proprietary Limited            7 204     6 130
- Roeland Street Investments 3 Proprietary Limited              327         -
Property management fees received from related party
- Roeland Street Investments 2 Proprietary Limited            4 685     3 393
- Roeland Street Investments 3 Proprietary Limited              228         -
Acquisition fees received from related party
- Roeland Street Investments 2 Proprietary Limited                -       490
- Roeland Street Investments 3 Proprietary Limited                -       336
Office rental paid to related party
- Stor-Age Property Holdings Proprietary Limited*               801       741
Disposal of Bryanston land
- Stor-Age Property Holdings Limited                         18 550         -

* The group leases certain premises at an arm's length

DERIVATIVE FINANCIAL INSTRUMENTS

Derivative financial instruments are classified as level 2 fair value instruments. The following table shows the valuation techniques used in measuring
level 2 fair values.

Level 2 fair values
Type                                                                      Valuation technique
Derivative financial instruments -  Forward exchange contracts            Fair valued monthly by Investec and Nedbank using mark-to-market mid market values. 
                                                                          This involves, inter alia, discounting the future cash flows using the yield curves
                                                                          at the reporting date and the credit risk inherent in the contract.

Derivative financial instruments -  Cross currency interest rate swaps    Fair valued monthly by Investec and Nedbank using mark-to-market mid market values.
                                                                          This involves, inter alia, discounting the future cash flows using the yield curves
                                                                          at the reporting date and the credit risk inherent in the contract.

Derivative financial instruments -  Interest rate swaps                   Fair valued monthly by Nedbank Capital and Royal Bank of Scotland using mark-to-market
                                                                          mid market values. This involves, inter alia, discounting the future cash flows 
                                                                          using the yield curves at the reporting date and the credit risk inherent in the
                                                                          contract.

CONTACT DETAILS

Registered office
216 Main Road
Claremont
7807

Transfer secretaries
Computershare Investor Services Proprietary Limited
2nd Floor
Rosebank Towers
15 Biermann Avenue
Rosebank

Sponsor
Questco Corporate Advisory Proprietary Limited
Ballywoods Office Park
33 Ballyclare Drive
Bryanston

Investor Relations
Singular Investor Relations Proprietary Limited
28 Fort Street
Birnam

Directors
PA Theodosiou (Chairman)#+, GM Lucas (CEO)*, SC Lucas*+,  SJ Horton*, MS Moloko#, GA Blackshaw, GBH Fox#, KM de Kock#, P Mbikwana#       

#        Independent
*        Executive
+        British citizen



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